The Bitcoin price index is once again showing a worrying bearish trend that was witnessed on 12th of March 2020 that resulted in the price tank from ~$10k to $3.5k within a matter of hours. The trend was a devastating blow to the existing bullish setup mostly propagated by the anticipation around the May 2020 halving. The market dropped sharply and it has been a tug of war between bulls and bears ever since.
The price tank witnessed earlier on forced many long-term hodlers to quit but the main effect was that the price decrease was followed by a pattern than involved a deep drop followed by a nominal price rebound and then another drop followed by another nominal rebound and so on. This was identified by a trader based in TraderKoz. He is of the opinion that the same chart could be repeated again but with a lesser drop. This is what he had to say:
Getting flashbacks to when we topped out in mid February. This PA literally looks exactly the same to me. pic.twitter.com/ayRwuWz1RA
— TraderKoz (@TraderKoz) April 13, 2020
But, at the same time, panic should be avoided as it is just an observation. If the price index manages to negate the move, it can be seen as a real positive aspect of the industry as it will have successfully neutralized another huge price tank from resulting in deeper losses to the trading and HOLDing communities.
In the short-term however, the condition are oversold and the cryptocurrency may test the $7200 figure again, but, the ensuing conditions may not be favourable for a further continuation of the rally and may risk deep losses eventually. A key figure of 100-week moving average of $7300 is being rejected repeatedly by the Bitcoin price index and this might be a sign that the hype around the may 2020 halving and with it, the chances of a significant bull run are under a significant threat. However, this is the opinion of one trader and other voices have called for HODLing in current times. Famous Bitcoin early adopter and co-CEO of Gemini exchange Cameron Winklevoss believes that Bitcoin is at an inflection point and has recommended HODLing and staying resolute.
While a correction may be expected according to similarities between the charts, the resulting pullback may not be as severe as the one witnessed on March 12 starting from late February. However, it can easily be seen that the expected euphoria among the population regarding the halving process is now probably over.
image source: pixabay.com